bp has reached an agreement to purchase 9GW of US-based solar development projects from independent American solar developer 7X Energy.
The assets, to be developed through bp’s 50-50 solar joint venture Lightsource bp, will grow the company’s clean energy pipeline from 14GW to 23GW. Therefore, this project will push bp towards achieving its goal of 20GW renewable capacity by 2025.
Dev Sanyal, bp executive vice president of gas and low carbon energy, said: “With this purchase, we are continuing to put our strategy in action as we grow our renewables business in a deliberate and disciplined way. It brings us 9GW of high-quality solar projects in markets where we can create integrated renewable energy offers through our trading and customer franchises.”
The projects are spread across 12 US states, with the largest portfolios in Texas and the Midwest. Assets with a combined generating capacity of 2.2GW are expected to reach the final investment decision by 2025, with the remaining progressing by 2030. Once developed, these projects will have the capacity to generate enough clean energy to power around 1.7 million US homes.
Dave Lawler, bp America chairman and president, said: “bp’s new high-quality solar portfolio will provide low carbon energy, create US jobs and deliver the competitive returns our shareholders expect.
bp will pay 7X Energy $220 million for the projects and 1GW of “safe harbour” equipment and expects the acquisition to complete in 30 days. The projects are expected to meet bp’s disciplined low carbon investment criteria, generating returns of at least 8-10%.